How has P&G consistently paid out dividends for the last 65 years?

P&G History and Background Information

Procter & Gamble Company (P&G) is a multinational consumer goods corporation, incorporating 65 companies such as Oral-B, Pampers and Tide.

Originally founded in 1837 as a soap and candle company, P&G is now one of the world’s largest companies, currently trading at $142.64 a share on the NYSE (as of August 29th 2021)[1], with an annual revenue of $76.118B in 2021, a 7.28% increase from 2020. According to the official P&G website, 180 countries sell their brands, with 5 billion consumers around the globe[2].

P&G has divided up its business activity up into ten separate sectors; fabric, baby, oral, personal health, hair, grooming, skin and personal care, home, and feminine care. It also operates through six industry-based Sector Business Units (SBUs), as listed below, with revenue and revenue shares displayed for the third quarter of 2021.


The P&G ventures SBU is a startup studio that seeks to innovate by funding and providing specialist knowledge to growing companies that are providing solutions to consumer problems in fields where P&G do not operate.

P&G Dividend Information

P&G has cemented its status as a dividend aristocrat, a publicly traded company that has consistently paid dividends every year to its investors for the last 25 years. Currently, there are 65 dividend aristocrats, with P&G paying the most consistently of all the dividend aristocrats, tied with Genuine Parts and Dover[4]. These three companies have paid dividends consistently for 65 years.

The average dividend yield for the consumer goods industry is 2.22%, with P&G currently paying slightly higher at 2.31%, as of the third quarter of 2021. They are paid four times a year, and not on quarters.

As the graph above shows, the dividend payout, is USD, has been constantly increasing for the last eleven years, despite the fluctuations in stock price, P&G have altered the dividend yield (% of share price paid as a dividend) to achieve these consistently increasing payouts. The dividend yield graph is shown below for the last ten years[5].

What has led to P&G maintaining such a consistent dividend payout?

There are three main strategies that P&G use to cement their status as a dividend aristocrat: utilizing their competitive advantage, margin expansion, and acquisitions.

P&G’s competitive advantage stems from two main factors, their product innovation, as well as their strong brand portfolio.

Strong brand portfolio – Most, if not all, of P&G’s brands are household names. These brands and their guarantee of quality is established through the heavy amounts of advertising they do. In fact, in June 2020, P&G raised its advertising expenditure up by $575 million, spending a total of $7.33 billion from June 2019 to June 2021[6]. As a result, they have been able to reach consumers around the globe and establish their brands as superior.

Innovation – P&G is a strong supporter of innovation, as evidenced by the activities of one of their Sector Business Units, P&G Ventures. One of their successful ventures includes Opte, a handheld device to reduce hyperpigmentation, which succeeded after over 14 years of research and development and was a revolutionary breakthrough in skincare [7].

P&G’s margin expansion is a result of effective cost cutting measures. One such measure in 2017 was to reduce its advertising budget, by slashing $200 million, following worries that the advertising was not reaching its intended audience. In 2015 it reduced the number of advertising agencies and partners they worked with, from 6000 to 2500, saving a further $750 million [8]. Further efficiency and margin expansion was achieved in November 2018, when a global restructuring of P&G (10 sectors into 6 SBUs) led to growth in these sectors as it allowed them more operational freedom [9].

Finally, P&G’s acquisitions have also led them to deliver a consistently rising dividend payout. In December 2018, P&G completed its acquisition of Merck [10], a consumer health goods service, as the OTC healthcare market was predicted to grow by 5% in 2025 [11]. The $4.2 billion deal contributed to the growth of P&G’s quarterly growth of 0.25%. However, this is unlikely to be a large aspect of growth, as in 2014, P&G dropped 105 brands, to focus on just 65, the brands that were generating 95% of their profit, and therefore suggests that P&G is prioritizing margin expansion through further cost cutting to maintain their rising dividend payouts.

To conclude, P&G would make a strong addition to any investment portfolio. Despite the economic effects of Covid-19 on supply chains around the world, it still continues to hold its position as a dividend aristocrat, in thanks to its commitment to cutting costs, as well as its investment in innovation, and the prudential way it acquires new companies.

Usman Arif, King’s College London

  1. P&G Stock Price, Yahoo Finance,
  2. About Us, PG Careers,
  3. Proctor and Gamble’s Revenue by Segment, Business Quant,
  4. What Are Dividend Aristocrats? These Are the 65 Dividend-Paying Stocks That Made the List in 2021, Mike De Socio,
  5. Procter & Gamble – 49 Year Dividend History | PG, Macrotrends,
  6. P&G hikes adspend 8% to $7.33bn in first increase for four years, Gideon Spanier,,2020%2C%20its%20annual%20report%20showed
  7. Our Partnership Stories, PG Ventures Studio,
  8. How to do cost-cutting right: lessons from P&G, Justin Dallaire,
  9. P&G announces organizational restructuring, Josh Kolm,
  10. P&G completes acquisition of Merck KGaA’s OTC division, George Underwood,,America%2C%20and%20Asia%2FEMEA.
  11. Dividend Aristocrats In Focus: The Procter & Gamble Company, Bob Ciura,

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